Creditor Ford Motor Credit Company LLC and the pro se Debtor filed a reaffirmation agreement seeking to reaffirm the Debtor’s lease of a vehicle. Given the uncertain status of the Debtor’s current expenditures (both in her original schedules and the revised, but unsupported, figures within the reaffirmation agreement), the lack of any cushion in the Debtor’s budget for unexpected expenses, and the additional fees and charges within the lease agreement beyond the monthly payments, the Court was unable to make a finding that the proposed reaffirmation agreement would not impose an undue hardship and was in the best interest of the Debtor. Moreover, the Debtor and the Creditor used the wrong procedural mechanism to continue the lease agreement. The parties would have been better served by assuming the lease through the separate procedures of 11 U.S.C. § 365(p) rather than seeking to reaffirm through 11 U.S.C. § 524(c). For those reasons, the Court disapproved the reaffirmation agreement. 
 

Creditor City of Winston-Salem filed a motion for relief from stay under 11 U.S.C. § 362 to allow the Creditor to file exercise reversionary powers contained in a warranty deed held by the Creditor on the Debtor’s real property. The Debtor contended the Creditor could not invoke the reversionary powers and intended to sell and leaseback the property as part of its subchapter V plan. While the Debtor and the Creditor filed a consent order providing for limited stay relief for the Creditor to pursue a resolution in state court, the Court found the three factors used in In re Robbins, 964 F.2d 342, 345 (4th Cir. 1992) did not favor stay relief in this instance. The first factor favored the Creditor as the litigation involved only matters of state law, but the other two Robbins factors weighed decidedly against stay relief. The litigation had not been initiated yet and there was a far greater likelihood that it would be completed sooner within the context of an adversary proceeding than if relegated to state court. The length of time required for the state court to reach a resolution would also delay consideration and confirmation of a chapter 11 plan, harming the estate far beyond what protection would be afforded by requiring the Creditor to seek enforcement of any judgment through the bankruptcy court. Given that the Robbins factors weighed against granting stay relief, the Court denied the Creditor’s motion, anticipating the parties would seek a resolution of the litigation through the filing of an adversary proceeding.

One day after it was due, the subchapter V Debtor requested an extension of the time in which to file its plan. In subchapter V, which was added to the Bankruptcy Code in February of 2020, a debtor must file a plan not later than 90 days after the order for relief. See 11 U.S.C. § 1189(b). While a request to extend the time under § 1189(b) does not have to be made prior to the expiration of the 90-day timeline, the moving party must meet a high burden by showing “the extension is attributable to circumstances for which the debtor should not justly be held accountable.” Persuasive caselaw interpreting 11 U.S.C. § 1221, which mirrors the extension language used in § 1189(b), shows this to be a more stringent standard than that required for extensions made under Federal Bankruptcy Rule 9006(b) or 11 U.S.C. § 1121(d)(1). The Court found the Debtor’s explanation for the delay in filing the plan — poor weather that delayed a walkthrough of a property to be sold — was unsupported by affidavits, exhibits or testimony and fell short of the circumstances warranting an extension of the plan filing deadline of § 1189(b). The Court therefore denied the Debtor’s motion to extend time.

The Plaintiff chapter 7 trustee moved to strike all of Defendant’s affirmative defenses as well as numerous paragraphs within the Answer. Prior to this decision, the Court entered a separate order overruling and denying the Defendant’s first affirmative defense—failure to state a claim upon which relief may be granted—because the Defendant failed to comply with the scheduling order by timely filing a supporting brief or memorandum. In this Order, the Court granted the motion to strike the Defendant’s eighth affirmative defense—unclean hands—without leave to amend because it did not constitute a legally sufficient defense where the Plaintiff seeks no equitable relief. The Defendant’s remaining affirmative defenses were also stricken, but with leave to amend, as “bare-bones” defenses that did not provide additional supporting facts or connect the defenses to the case at hand. Finally, the Court declined to strike those paragraphs asserting that a document “speaks for itself” or claiming the Complaint called for “legal conclusions to which no response is required.” The Court found the Defendant denied the allegations in the alternative in all but six of the cited paragraphs and also included a general denial which, taken together, did not present a sufficiently egregious violation of the rules of procedure to justify granting the Plaintiff’s motion to strike as to those paragraphs.